Exxon to spend $1 million to promote tax on CO2

By Tim Pearce|2018-10-10T09:12:18+00:00October 10th, 2018|Energy|Comments Off on Exxon to spend $1 million to promote tax on CO2

Oil industry giant ExxonMobil has pledged to donate $1 million to a group campaigning for a national carbon tax that would primarily impact coal, oil and gas producers and consumers.

Exxon’s donation is one of very few to come out of the oil industry. It also comes as Republicans, who are generally opposed to a carbon tax with some notable exceptions, hold the White House and Congress.

Exxon is sending the money to Americans for Carbon Dividends (ACD), a group headed by former Senate Majority Leader Trent Lott, a Republican. ACD is pushing a carbon tax-plus-dividend policy that claims to be revenue neutral after the taxes collected are paid back to consumers to compensate for the hike in energy bills, The Wall Street Journal reports.

Exxon is likely supporting the carbon tax as a cheaper alternate to more numerous costly regulations. Using a straight carbon tax instead of an assortment of other rules and regulations would streamline the bureaucracy surrounding the oil and gas industry, according to WSJ.

Many conservative and right-leaning groups are skeptical or outright critical of a carbon tax. Some pro-carbon tax Republicans have tried to generate more support for the idea on the right by depicting it is as a market-based approach to combatting climate change.

The Heartland Institute, a free-market think tank, blasted a policy proposal similar to ACD’s in a policy brief October 4. The “revenue-neutral” carbon tax – which claims to offset the cost to consumers – is a myth, according Heartland Institute energy and environment researcher James Taylor.

“Oil, coal, and natural gas are the foundation of U.S. and global energy use, because they are the most affordable and efficient energy sources,” Taylor writes in a policy brief. “Driving these forms of energy out of the marketplace, either through high CO2 taxes or direct government restrictions, would necessarily raise energy costs and inflict severe economic punishment, not only on U.S. households, but also on the entire economy.”

“One cannot transform the U.S. economy from one utilizing low-cost energy sources to one shackled to unreliable, high-cost energy sources such as wind and solar and then credibly claim this will benefit the economy,” Taylor adds.

The United Nations Intergovernmental Panel on Climate Change (IPCC) advocated using a radical, international carbon tax to cut world-wide emissions and meet targets laid out in the 2015 Paris Climate Accords. The IPCC suggested implementing a tax equivalent to $240 per gallon of gas by 2100.